I’m a chef, not a political hack, and I’ve had the good fortune of practicing my craft in Sacramento. Every night my employees and I have a hundred of our “friends” over for dinner. We help celebrate the much deserved weeknight out, birthdays and weddings, anniversaries, and the occasional political fundraiser.
I may own my restaurant, but I don’t own the building, nor do a majority of Sacramento restaurateurs. That’s why I am so worried about Proposition 15 and its impact on small businesses like mine.
Our restaurant, Mulvaney’s B&L, has been a labor of love for my wife Bobbin and me for more than 15 years. Its success has given us the opportunity to invest in our extended family of employees and participate in a host of important community endeavors. But, as challenging as the restaurant industry can be, it pales in comparison to what my restaurant, and restaurants across Sacramento and California, are living through today.
During the past five months of the COVID-19 pandemic, I’ve furloughed most of my employees and watched many of my restaurant chef-owners do the same. A number of my restaurant colleagues have called it quits, unable to weather the tremendous storm caused by the pandemic. More permanent closures are on the way.
As anyone who knows me will attest, I am not one to interject myself into the political arena, preferring instead to wax political from the other side of the bar. But as I take stock of my business, and the many who are struggling alongside me to keep the lights on, keep what’s left of our employees working and pay the rent, I feel compelled to speak out and urge Governor Newsom to stand with the thousands of small businesses and restaurants that are hurting and oppose Prop 15.
The evidence in opposition to Prop 15 is overwhelming, especially if you’re a small business owner like me. Here’s something most people don’t know. California restaurants are one of the state’s largest employers. Prior to the pandemic, the restaurant industry employed more than 1.5 million Californians. Sadly, more than 700,000 employees have lost their jobs in the last five months alone, and the numbers will get worse – much worse – if Prop 15 passes.
Like many restaurant owners, the B&L pay’s rent under what’s called a ‘triple net lease.’ That means in addition to the rent, I have to pay my portion of the property tax bill, insurance and maintenance costs associated with the building. I hear the arguments proponents make about how small businesses are exempt, that it’s the “big corporate owners” who will pick up the tab. Nothing could be further from the truth for me and thousands like me in California. I’m not the only one who’s going to get stuck paying the $11.5 billion tab each year.
Because Prop 15 raises property taxes, and those higher taxes get passed on to small business tenants like me, we have to choose between passing those higher costs on to consumers, reducing staff or going out of business. And it doesn’t stop with me. The farmers I get my produce from, the dairymen and women who provide me with milk, eggs and butter and the ranchers who provide me with the beef, pork chops and chicken we serve every night are all a part of the supply chain who will be impacted by Prop 15’s tax increase.
I understand that we need to find additional resources to fund our education system. And because of the costs associated with COVID, local governments are being squeezed and will be challenged to continue providing basic services. But putting me and others like me out of business isn’t the solution either.
Now is the time for the legislature and Governor Newsom to roll up their sleeves and find a balanced solution to right our state’s fiscal affairs without further breaking the backs of small business. In order to return California’s small businesses to full strength so that they create jobs, generate income and pay taxes to get our economy working again, Governor Newsom should do the right thing and oppose Prop 15. To do otherwise will only serve to get in the way of our recovery and make things worse.